A Look At Puma Biotechnology Inc (PBYI)’s Breast Cancer Candidate

At the end of last week, Puma Biotechnology Inc (NYSE:PBYI) announced the filing of an NDA for its lead breast cancer candidate, as well as releasing some updated results relating to the long term efficacy and safety of the drug.

The company is up more than 20% heading into the US open on Monday, as speculation that the FDA will approve neratinib, the drug in question, at some point early to mid 2017. The gains underline the potential impact of an approval for Puma, so ahead of any action from the FDA, let’s take a look the science that underpins the drug and the data on which the application rests, in an attempt to estimate the chances of approval.

Neratinib is what’s called a tyrosine kinase inhibitor. We’ve discussed this type of drug in quite a lot of detail in the past here at Market Exclusive, but for those new to the science, here’s a quick overview of how it works.

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That’s the science, what does the data show? The trial was called ExteNET, and it was a phase III safety efficacy effort, deigned to show superiority over placebo. In total 2,840 women were recruited, and dosed orally for one year with either neratinib or placebo. The data showed that the women dosed in the active arm of the trial (i.e. the ones who took neratinib) had a reduced risk of recurrence or death to the tune of 33% when compared to placebo. Safety was acceptable, with no real AEs outside of those expected on the back of this sort of treatment, and two-year disease free survival (DFS) in the neratinib group came in at 93.9% versus 91.6% for the placebo arm.

Basically, that’s great data. The application is for an adjuvant approval, so the drug will be administered after first line treatment, so any expansive effect that it has on first line (like the one the data showed neratinib has) is a real kicker for a drugs chances come PDUFA.

So what’s the potential impact of an approval? This is where we find out why Puma gained 20% on Friday – analysts put the peak sales estimate for the drug across the next decade at between $3 billion and $6 billion. This would make it one of the biggest selling drugs on the market. Puma’s got no drugs on the market as things stand, and has a market cap of a little over $1.3 billion. With a $6 billion candidate pending, there’s plenty of potential upside as the drug moves through the NDA process.

So what’s next? Well, now, it’s all about patience. There’s every chance the market will trade up slightly on Puma across the next couple of months, as we wait for the FDA acceptance of the application, but likely not to a huge degree. The big moves will come on acceptance (which just means the FDA is happy with the application’s completeness and sets a PDUFA) and, of course, beyond that, PDUFA. As mentioned above, if things run smoothly, we should be looking at a PDUFA some time before the end of H1 2017.